Wednesday, April 20, 2016

Kinder Morgan shelves $3 billion pipeline project

Energy giant Kinder Morgan Inc. has suspended additional work and
spending on its Northeast Energy Direct project, a controversial natural
gas pipeline proposed through Massachusetts and New Hampshire.

Kinder
Morgan said on Wednesday that the company didn’t receive the extra
commitments from big customers that it needed to proceed with the $3.3
billion project. As a result, Kinder Morgan said in a statement, “there
are currently neither sufficient volumes, nor a reasonable expectation
of securing them, to proceed with the project as it is currently
configured.”

Kinder Morgan’s initial approval of the project, through its
Tennessee Gas Pipeline subsidiary, was based on existing contracts with
gas utilities as well as the expectation that others would sign on to
buy gas from the line. Executives at the Texas company were also
counting on an unprecedented shift in New England’s market that would
allow electric customers to be assessed for pipeline construction costs.

Kinder
Morgan cited several reasons for this shortfall, including the fact
that it remains far from assured whether New England states will be
successful in setting up rules to allow electric customers to be charged
for gas pipelines.

Kinder Morgan’s statement didn’t mention the
concerns raised by the project’s numerous opponents, including residents
of towns that would be affected by the pipeline’s construction and
environmentalists who worried that the size of the project could make
New England too dependent on natural gas.

“Kinder Morgan is stopping the pipeline because it is both expensive
to ratepayers and simply not needed,” George Bachrach, president of the
Environmental League of Massachusetts, said in an email. “Massachusetts
has the capacity to develop its own energy in solar, wind and hydro. In
the process, we can create new industries and jobs here, rather than
exporting our dollars and jobs to fossil fuel states.”

State
Senate president Stanley C. Rosenberg, one of a number of Western
Massachusetts politicians who opposed the project, said in a statement:
“Kinder Morgan’s decision to suspend the Northeast Energy Direct (NED)
project is a game changer. This allows us to have a broader discussion
about how to meet Massachusetts’ energy needs.”